Advertising in the Global Age: Transnational Campaigns and Pan-European Television Channels Jean K
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Global Media and Communication http://gmc.sagepub.com Advertising in the global age: Transnational campaigns and pan-European television channels Jean K. Chalaby Global Media and Communication 2008; 4; 139 DOI: 10.1177/1742766508091517 The online version of this article can be found at: http://gmc.sagepub.com/cgi/content/abstract/4/2/139 Published by: http://www.sagepublications.com Additional services and information for Global Media and Communication can be found at: Email Alerts: http://gmc.sagepub.com/cgi/alerts Subscriptions: http://gmc.sagepub.com/subscriptions Reprints: http://www.sagepub.com/journalsReprints.nav Permissions: http://www.sagepub.co.uk/journalsPermissions.nav Citations http://gmc.sagepub.com/cgi/content/refs/4/2/139 Downloaded from http://gmc.sagepub.com at SAGE Publications on November 12, 2009 ARTICLE Advertising in the global age Transnational campaigns and pan-European television channels ■ Jean K. Chalaby City University, UK ABSTRACT The first pan-regional satellite TV stations in Europe ran into financial difficulties because too few companies had the interest and ability to run international advertising campaigns. Their financial shape improved with the upturn of the pan- European advertising market in the 1990s. The pool of international advertisers expanded as multinationals adjusted their marketing strategy to the challenges and opportunities of globalization. The advertising industry restructured, this article argues, creating media buying agencies with specialist knowledge of pan- European television and the network to run transnational advertising campaigns that mix local and global objectives. Pan-European TV stations began, the article notes, to offer flexible local advertising windows and integrated communication solutions involving cross-format and cross-platform opportunities for advertisers. KEY WORDS European marketing ■ global branding ■ globalization ■ international advertising ■ pan-European television (PETV) ■ transnational television A tale of two decades: the pan-European advertising market from the 1980s to the 1990s Cross-border satellite TV channels began broadcasting in Europe in the early 1980s. These stations were soon in the grip of a series of problems that ranged from unreliable satellite technology to governments’ reluc- tance to grant access to their market. Channels were struggling with problems regarding programme production, scheduling, marketing and a whole range of localization issues (Chalaby, 2005). Their finances were in poor shape because advertisers rapidly lost interest in the medium. It was a difficult period for cross-border TV stations and many were out of Global Media and Communication [1742-7665(2008)4:2] Volume 4(2): 139–156 Copyright © 2008 SAGE Publications (Los Angeles, London, New Delhi and Singapore: 139 http://gmc.sagepub.com)/10.1177/1742766508091517 Downloaded from http://gmc.sagepub.com at SAGE Publications on November 12, 2009 140 Global Media and Communication 4(2) business by the end of the decade. News International’s Sky Channel (1983–1989), Thorn EMI’s Music Box (1984–1986), WH Smith’s Screensport (1984–1993) and Lifestyle (1985–1993), Europa (1985–1986), the Arts Channel (1985–1989), ITV’s Super Channel (1987–1988) and the European Business Channel (1989–1990) were the most prominent names in a list of casualties that included other smaller ventures and stillborn projects. The financial difficulties that caused the demise of these channels might seem paradoxical considering the unsated demand for advertising airtime. Approximately 27 channels accepted commercials in Europe in 1984; nearly all were in the hands of public service broadcasters who doled them out in small quantities. Four countries banned advertising altogether: Belgium, Denmark, Norway and Sweden. A conservative estimate of the time placed the demand for airtime at nearly twice the amount that was on offer (Syfret, 1987: 34–7). When satellite channels first appeared, advertisers were keen to book airtime. The first commercial was booked by Unilever for the deodorant Impulse on Haynes’ Satellite Television plc (the channel Rupert Murdoch bought and renamed Sky in the summer of 1983), followed by multinationals ranging from Coca-Cola and Philips to Shell and Kellogg’s. It became quickly apparent to these companies that pan- European television was a medium particularly ill-suited to advertise FMCGs (fast moving consumer goods). Most multinationals did not return to international TV stations, which ultimately saw very little of their advertising money. Research in 1988 estimated that the pan- European TV advertising market was the equivalent of 1.5 per cent of the British market or – according to a 1991 study – about the combined advertising revenue of ITV and Channel 4 in the UK for a month (Barker, 1991: 19; O’Carroll, 1988). Three advertising agencies were initially interested in pan-European television: Foote, Cone & Belding, McCann Erickson and J. Walter Thompson, and they all quickly spotted a range of issues. Too few com- panies had the need for the pan-European coverage offered by channels like Sky and Super. Brand names changed across the continent, as did packaging and product cycle. Most multinationals devolved marketing to their local affiliates, passing on the advertising budget to a local agency (Billen, 1984: 56). Very few campaigns were suitable for inter- national treatment, and to place a message on pan-European television an advertising agency had to coordinate marketing strategies across Europe.1 For instance, this localized marketing structure was adopted by two big advertising spenders, Nestlé and Unilever, and they had Downloaded from http://gmc.sagepub.com at SAGE Publications on November 12, 2009 Chalaby Advertising in the global age 141 practically no means of running a centralized advertising campaign. As Toby Syfret (1989) summarized: either budgets allocated to pan-European broadcasts were constrained by the client’s difficulty in securing a central budget; or proposals that looked good were not acted upon because the client had no mechanism for taking a central decision; or local agency opposition defeated a consensus. From the client angle, nothing would seem to work worse than the quite common practice of going cap in hand to local offices in order to persuade them to stump up their contributions. Some want the campaign, others are sure to prefer to invest in domestic media, quite possibly urged on by the local agency which does not want to see part of its natural budget disappear, and so on. The end result is frustration for all concerned. Satellite channels did not have the flexibility of offering local advertising windows. Clients could not block out a country where, for instance, their product had yet to be introduced. Pan-regional coverage was a waste if they were present in only a handful of territories. The distribution of audiences was another matter for concern. As far as they could be measured, satellite channels reached vastly different audiences, both in size and demographics, from one country to another. A channel could reach a young audience in high numbers in a country like the Netherlands and an older audience in fewer numbers in Germany, where cable penetration was not as extensive. Political and cultural issues were also a matter of concern. In particular, advertising regulations differed markedly: some countries banned advertising for children and others banned children in commercials. While advertising for tobacco was prohibited everywhere, a range of products, such as alcohol, faced a variety of legal restrictions. When advertising itself was not regulated, consumer markets for products such as pharmaceuticals differed from country to country. These impediments to pan-European marketing campaigns restricted the pool of international advertisers to well below the 200 or so multi- nationals that possessed international brands (Syfret, 1989: 56). These limitations resulted in a soft market for pan-European TV advertising, which explains much of the financial difficulties that satellite channels faced in the 1980s. PETV in the 1990s: a change of circumstance The market for pan-European television (PETV) greatly improved in the 1990s. Technology became altogether more affordable and more reliable and EU legislation facilitated the international reception of satellite TV Downloaded from http://gmc.sagepub.com at SAGE Publications on November 12, 2009 142 Global Media and Communication 4(2) Table 1 Full-time distribution of leading eight pan-European television channels, 2003–2006 (in million of TV households) 2003 2004 2005 2006 BBC World 57.5 66.0 72.6 82.2 CNBC Europe 54.3 55.5 63.5 61.6 CNN International 90.0 95.8 98.2 101.6 EuroNews 55.5 56.0 62.8 75.9 Eurosport 94.4 95.6 101.2 104.5 MTV 99.2 103.6 107.8 112.2 TV5 Monde 83.7 87.4 94.6 99.3 Source: M&M Guide to Pan-European Television, 2003/06 Table 2 Cross-border TV channels in Europe according to genre Genre Channel News Al-Jazeera English; BBC World; CNN; Deutsche Welle; EuroNews; France 24; Fox News International; NDTV 24x7; Russia Today; Sky News Business news Bloomberg Television; CNBC Europe Generalist Arte; TV5 Factual entertainment The Biography Channel; Discovery suite of channels; E! Entertainment; Fashion TV; The History Channel; National Geographic; Travel Channel; Zone Reality suite of channels Sports Eurosport; ESPN Classic; Extreme Sports Channel; Motors TV; North American Sport Network Entertainment BBC Prime; FX; Hallmark; Paramount Comedy; Zone Club;